Guidance on confirming whether a contract is for labour only
During the Contract Notification process on ROS, the principal will be asked the following question:
“Are you satisfied that the contract is NOT a labour only contract?”
Before answering this question, the principal contractor must already have satisfied themselves that the contract is not a contract of employment in accordance with the Code of Practice for Determining Employment or Self-Employment Status of Individuals.
In order to allow the Revenue Commissioners monitor the application of the Code, further information is required where the contract is for labour only.
What is a labour only contract?
- Under a labour only contract, the worker supplies labour only and does not supply materials for the job.
- Furthermore the worker does not provide equipment other than the small tools of the trade.
- While the provision of tools or equipment might not have a significant bearing on coming to a conclusion that employment status may be appropriate having regard to all the circumstances of a particular case, further information needs to be supplied to the Revenue Commissioners.
- Where the contract is with an entity that supplies workers on a labour only basis, then the contract is for the provision of services and not a labour only contract.
To summarise, where the principal has considered the criteria in the Code of Practice for Determining Employment or Self-Employment Status of Individuals and concluded that the contract is not a contract of employment, further information must be provided to the Revenue Commissioners if the contract is a labour only contract as outlined above.